The morning news. [volume] (Savannah, Ga.) 1887-1900, 1887-09-02
GROVESTEEN 81 PsLL.
Wall Street Full of Grave Rumors Con-
corning Their Transactions.

corning Their TRANSACTIONS.
The New York Times, after giving an
account of the arrest of Mr.. Pell, of the
firm of Grovesteen & Pell, on the charge of
obtaining money by false representations
and the transactions which led up to it,
already printed in the MORNING NEWS,
says:
Much graver charges are circulated
charges that have to be corroborated only
to pIecipitate a scandal, or worse An ex-
pert has been at work on the books OF
Grovesteen a. Pell. The result if his re-
port is to be relied on, has sensation in it.
The firm was floating two rail-
roadside Rome and Decatur and
the East and West road of
Alabama. Upon the Rome and Decatur
road it is shown that S345, 900 was expend-
ed The firm employed Maj. Dan Callahan,
of Savannah, Ga, to build the road. he
was to have $40, 900 a mile for his construc-
ton. The company authorized the issue of
$4,000 mile in mortgage bonds. Just
thirty miles have been built. At the rate
Of $4,000 a mile this would warrant the
issue of S450000 in first mortgages 1t is
discovered that 100000 have been issued.
Gen. Daniel s. Printup, of Rome, Ca,
who died some time ago, was the Rome and
Decatur roads President, and now it leaks
out that he, acting under more or less direct
100000 of bonds for equipment. That
100000 of bonds-probably representing
the over-issue that makes up the total of
$3.50, 000--was put out The half finished
road has equipment worth possibly $50, 900.
In the East and West Alabama road there
is quite as bad showing, if the current re-
port Is to be accepted. Grovesteen &, Pell
bought the road for Browning & Co., of
New York, paying 30 for its bonds. 1t was
a narrow gauge. GroveSteen e. Pell had
plans that called for standard gauge
and authorization was secured for broaden
ing the track, increasing the companys
mortgage from $4,000 a mile to 5000,
the change of gauge to cost 81, 900 mile.
The outstanding $4,000 per mile mortgage
was cancelled and a lien of $4,000 mile
was stretched over the entire 126 miles of
road. Six miles of road We're broadened.
Activity was made in the bonds on the
Stock Exchange, and quotations of 107 and
100 were made familiar in the official trans
actions. The bonds were all sold to a big
European syndicate, so the current story
represented and the bBnks took them as
sort of gilt-edged collateral at so. One mile
of road for whose n-thousand-dollar bonds
Grovesteen & Pell had paid 80, or $4,000, the
firm was able TO use for floating, with prac-
tically no increase of investment, fifteen
thousand dollar bonds at so, or $l2, 900, a
mere profit of g., 600 per mile on over 40
miles, or close to S400,00 This certainly
was financiering with vengeance-if the
books Of the firm really establish such trans
actions, as alleged 1t is a matter of rec
ord that the bonds, hich were stiff at 100
on the Stock Exchange, went pell NELL
to 65, and didn't meet bid when Stokes &
Co. tried to make their sale under the rule
last week, though as collateral the mort
cages had passed all over Wall street as per-
fectly acceptable at 50 hitherto
1t is estimated that Grovesteen 81 Pell put
bonds af1oat on their Southern roads aggre-
eating something like $1,500,0O0, while less
than third of that sum was really ex-
pended The bonds alleged to have been
overissued are in loans all over Wall street.
Aid stock on Southern roads to which the
claim of Grovesteen & Pell is contested was
used, too, to help the firm raise money.
Where all the missing hundreds of thous-
ands of dollars have gore is deep mystery.
Friends of the firm believe that some show
ing can be made which will straigbten ev-
erything out But it is reported in inner
circles that the accounts of the firm are ia
decidedly "crude condition." and some
important vouchers are missing Some
charges are made on the firms books, too,
it is alleged against the Rome and De
catur road, which memoranda explains are
Ito be charged to the East and West road"
Assignee Harding is not yet ready to pro-
duce a schedule of the firms liabilities and
assets, but he has intimated that it would
be ready to-day, and that it would make
good showing in dollars and cents way. His
statements indicate that nothing has been
done that cannot be satisfactorily explained
In the meantime, however, Wall street is
doing some very interesting talking and
taking strange liberties with the name of the
troubled firm.